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Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

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21–30 of 138 posts

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#21
I think the book is 90% full of just filler text, i wish it was shorter. The advice i think is valuable which i took from the book was to concentrate on cashflow.

Analyse all the things you pay each month and try to get each of those payments to be less, this is especially easy for things like mobile phone contracts, gym memberships, TV subscriptions, etc. Then you have more money each month. If your cashflow is greater each month, you'll be better off.

I think this advice is applicable to most people and more importantly, its actionable.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#22
post #7

This person severely misread the book. I could give quite a few examples from the writing. For instance, the child labor issue he brings up is ridiculous - "Rich Dad" obviously didn't benefit from this labor in any financial way. The premise of the book is solid; invest in assets that make money for you without you having to be there. He specifically says in the book a few times that he doesn't necessarily advocate r…

"Rich Dad" does seriously advocate real estate, not to the exclusion of those other options but certainly above them. Real estate stands out mostly because of the leverage that a mortgage can provide: you can control the income and appreciation of a $250,000 asset with only $50k of actual capital. You can't get 5-to-1 leverage on stocks or other such passive investments.

That said, real estate is certainly no magic bullet. You certainly take on risk, of depreciation and vacancy time and deadbeat tenants. And it's hard work to keep a property maintained or expensive to hire someone to do it. It's not for everyone. These are the points that "Rich Dad" doesn't make and must be included for a balanced perspective.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#23
post #2

Don't really get the arguments. Don't spend more then you earn. So why is it bad to destroy your credit rating? Advise is not using credit. Maybe he wrote the book for Europeans? We don't have a credit rating. Just if you fuck up you get blacklisted and don't receive any credit. But we don't have a personal bankruptcy system either ;) Actually it's not that bad to pay yourself first and the government later. You have…

The UK is in Europe, and we certainly have credit rating agencies and personal bankruptcy.

Laws differ between countries in Europe. Please don't try and generalize unless you're certain there are no exceptions, otherwise it may give people incorrect information. Instead, mention your country specifically.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#24
I disagree with the review. The book doesn't contain a complete and perfect path to personal wealth for anyone. But what book could ever accomplish that?

Disclaimer: I read it several years ago. But the takeaways of the book that stayed with me to this date are:

* Don't get emotionally attached to the concepts of money and debt. Money is not worth anything by itself and debt is not bad by itself. They are simply tools that you use and you can use them wisely or foolishly.

* Try to invest your money and time in a way that creates recurring income. I.e. a house is a very bad investment because it creates recurring costs rather than income. Of course you need somewhere to live but don't get emotionally attached to the idea that happiness equals living in a fancy house or driving a fancy car.

* Debt is nothing more and nothing less than a tool for creating recurring income as long as the costs of the debt are lower than the income it creates. Discounting for risk etc.

* The way we teach our kids "the value of money" is creating exactly the emotional ties above that will lead them to making bad decisions about their personal finances, and ties their happiness to how much money they have in the bank.

I don't know if these points are what the book says, simply because I don't know how much of it is my own interpretations. But reading this book allowed me to come to a number of conclusions that have been very helpful ever since. I can think more clearly about what money, income, debt and costs really are.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#25
post #10

I disagree.. the most important message in the book is that business and entrepreneurship is the path to success, NOT being an employee and staying in the rat race. While it may be common sense to someone who's been in business for a while, or read a lot of similar literature, it's far from obvious to most people. I'm not ashamed to say Rich Dad Poor Dad has been one of the most influential books I've read in my life…

Sounds more like inspiration and self-help than personal finance. You could point to any number of career paths and say, "This is a well-established route to wealth, and if you work very very hard and manage your money well, you can become wealthy this way." For example, there are high-paying specialties in law and medicine where the rat race really does lead to wealth. You have to outcompete 95% of the people in your field to become wealthy, but the same thing is true of entrepreneurship.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#27
post #10

I disagree.. the most important message in the book is that business and entrepreneurship is the path to success, NOT being an employee and staying in the rat race. While it may be common sense to someone who's been in business for a while, or read a lot of similar literature, it's far from obvious to most people. I'm not ashamed to say Rich Dad Poor Dad has been one of the most influential books I've read in my life…

"the most important message in the book is that business and entrepreneurship is the path to success"

No, it may be one of the best paths to wealth and independence --unless you're born into wealth already -- but it's not necessarily a path to success.

My parents worked themselves to the bone in business, were repeatedly screwed by business partners and banks. It didn't give them one bit of gratification.

My mother went back to university and got into not-for-profit microcredit and was reborn as a happy person.

My dad spent time with his kids and neighbours, when he passed away he had three times as many people come to the funeral as we had space for.

Entrepreneurship has a lot going for it, but it is very hard and given the barriers that can be thrown in your face, it can be just another rat-race for lots of people.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#28
I think it is a good book. I agree it is really bad written, but also provides a different perspective over a few important areas, like owning(second) houses being liabilities instead of assets for most people, and them not realizing that.

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#29
post #26

I'm always fascinated as to why people on this board fervently defend scammy self-help books. Tim Ferris' completely phony 4-hour series provoked a similar reaction.

Why scammy? It's pretty common sense that these books do not offer any recipes for wealth creation, but they do offer something very important: the correct mindset for wealth creation. That is something that many many people lack and need.

Finally, if you find it useless, why do you assume that everybody else does so as well?

Re: Rich Dad Poor Dad... Worst Personal Finance Book of All Time?

#30
post #26

I'm always fascinated as to why people on this board fervently defend scammy self-help books. Tim Ferris' completely phony 4-hour series provoked a similar reaction.

I suppose we have different definitions of "scammy". RDPD and the 4-hour series both package up common-sense recommendations in a way that resonates with a lot of people. There might not be a whole lot of substance there, but I don't think that's the point. The people who buy (and enjoy) those books, are the ones who just want to find someone else saying what they're thinking. It's a bit of extra motivation towards their goal.

There's not a whole lot of value there beyond confirmation of common-sense ideas, but I don't think that's a scam.

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